From Stuttgart to the Danube: How the Next Hidden Champions Will Come from Romania
How We Broke the Money Printing Machine in Danube Region & Where the Next Hidden Champions Will Come From
On a gray morning in my German automotive town of Stuttgart, Weil der Stadt, the parking lots stay mostly empty. The S-Bahn glides into the station, its familiar mechanical sound echoing through the chilly air. Yet, as the doors slide open, no passengers step outside. The last bakery in the area still gives this illusion of normalcy.
But inside the expansive office complexes, fluorescent lights flicker on, casting a sterile glow on empty desks. At the same time, coffee machines hum monotonously in the background. Despite the outward signs of activity, an unsettling atmosphere lingers. Project lists have begun to dwindle, innovative feature ideas are creeping along at a snail’s pace, and within many teams, a quiet, anxious question hangs unspoken: “Will there still be a place for me here next year?”
For two decades, the Middelstand (SME) companies across Germany, France, and Britain (+US) constructed a seemingly unbreakable system that expanded almost without bounds. A network of remote offices, near-shoring centers grew in Europe and beyond as major suppliers, automotive giants, and IT firms continually piled on more projects, more teams, and additional locations.
This growth felt reassuring, as soaring demand and record profits masked the underlying vulnerabilities. No one dared to disturb this expansive machine while it still churned out profits day after day.
Now what is unfolding in Stuttgart is far more than a local phenomenon; it carries profound implications for the entire tech sector along the Danube corridor. This vital artery of Europe stretches from the industrious landscapes of Southern Germany, through the vibrant hubs of Central and Eastern Europe—including Hungary, Slovenia, and Slovakia—all the way down to Romania, where the Danube River gracefully meets the Black Sea at the bustling port city of Constanța.
As the once-reliable project development business model begins to show signs of deterioration, a new pathway is emerging on the horizon. This transition moves away from reliance on service centers and embraces a dynamic rise of "Hidden Champions." These innovative companies are not only taking root in Germany but are also thriving throughout the wider CEE region, including Poland, Hungary, and the Baltics. Particularly in Romania, there lies significant opportunity. Here, creativity and adaptability are flourishing in practical and impactful ways, signaling a shift towards a more resilient and forward-thinking tech landscape.
How We Got Here: Too Many Projects, Too Many People
In the first part of this story (last Depp Dive, End of Outsourcing), we need to be honest about what went wrong.
To meet the consumer demand of 2010s, companies established large development centers in Romania and across Central and Eastern Europe alongside the Danube river. Thousands of engineers were hired by outsourcing firms and captive centers. As long as profits were strong, no one asked tough questions. High demand and rising prices made the system appear very successful. Extra complexity was seen not as a problem, but as a normal cost of doing business. Instead of simplifying processes, many companies retained the old model and used extra cash to reward shareholders.
Today, the mood is very different. Demand has shifted, money is more expensive, and advancements in AI have made some tasks faster or cheaper. Many companies are discovering they have too many employees relative to their current workload. Numerous development centers and outsourcing partners keep people “on the bench,” meaning these employees remain on payroll but have no real projects to work on. In prosperous times, having a bench was viewed as a strength; now, it appears to be a cost burden.
Given the over-hiring during the Covid pandemic, combined with the influences of AI and better resource utilization, many companies could realistically accomplish the same work with fewer people. It’s estimated that the industry could shrink by about one-third without compromising delivery. While this situation is painful for individuals, it helps to explain why layoffs feel particularly challenging right now.
Four Paths Forward
From this point, we can identify four main potential outcomes for employees of development centers in the CEE, which can occur simultaneously in different contexts.
Soft Landing on the Bench: Companies gradually reduce the size of their bench instead of terminating everyone at once. Employees transition from “idle” to “billable” work, sometimes taking on new technology stacks or roles. While jobs remain, the work environment becomes more demanding, with increased pressure, more retraining, and less flexibility.
Hard Cuts and Layoffs: In cases where the gap between demand and capacity is too large, firms will cut capacity sharply. Temporary contracts will end, teams may be disbanded, and some locations could shrink or close entirely. This is the visible aspect that appears in the news: layoffs, social plans, and headlines about a “crisis.”
Reskilling into New Demand: Some employees will shift into areas with growing demand, such as AI, cloud computing, security, data, and product development. Companies may invest in training programs and internal mobility, rather than solely relying on external hires. For skilled engineers, this situation could represent an opportunity to advance rather than merely survive.
New Companies and Products: A smaller yet significant group will leave to start anew. They will create startups, product companies, or specialized boutiques, contributing to new intellectual property, tools, and jobs for the next growth cycle.
This fourth path is the focus of this article.
A Squeezed Middle?
On my desk there are two books that describe the same quiet transformation of the Mittlestand ( Small to Medium Size Enterprise, the backbone of European Technology) from different angles. One is about selling outsourcing services. The other is about venture clienting. Together, they tell the story of how a whole layer of engineering and software companies was pushed out between global service giants on one side and young startups on the other.
The outsourcing book starts with a simple message: for years, there has been a hard displacement game going on.
How Ticket based Development Created Giant Engineering Service Factories
When global companies, those big brands and large international corporations – from Fortune 500 companies to DAX groups – first began to offer outsourcing services, the concept seemed harmless. Instead of selling a physical product, they were supplying time, expertise, and teams.
This trend influenced procurement practices in Fortune 500 companies, as well as international European corporations and small-to-medium-sized enterprises (SMEs). It created an ideal environment for these large firms to thrive. Purchasing became highly centralized, with master service agreements and preferred vendor lists replacing localized decision-making. Rather than managing many small contracts, a single global framework could cover all needs.
Over time, this approach led to the emergence of a new type of company: the giant global service provider.
Typical traits:
They do not sell their own products, but bill hours and projects to other companies.
They are multinational groups with tens of thousands or even hundreds of thousands of employees in 50–60 countries.
Their business is IT services, consulting and business process outsourcing: application development, cloud, cybersecurity, data analytics, ERP, support, back office work.
Many of them – Wipro, TCS, Infosys, HCLTech and others – work in a global delivery model: a small part of the team sits with the customer, while the majority works from lower‑cost countries like India or Eastern Europe.
They help their clients with digital transformation, moving old IT landscapes into modern cloud, AI and data‑driven systems.
If you had the size, you were in. If you did not, you slowly disappeared from the vendor list.
Romania is an example of this model from the delivery side. Romania today does not host a “Wipro of its own”. It is a delivery base for global giants like IBM, Oracle, HPE or Wipro – whose headquarters are in the US, India or Western Europe – but it has not yet created a home‑grown service giant of that scale. Romania’s engineering service stayed mid‑sized and regional, often owner‑run and locally focused.
Engineering Service Firms Born in the Mittelstand
In Europe, a distinct type of service company evolved alongside traditional models. These were not the late-stage Indian-style outsourcers; rather, they were engineering service firms that formed close partnerships with mid-sized industrial companies and large manufacturers. In Germany, France, the UK, and other countries, these firms became known as classic engineering providers, specializing in design, testing, and development for the automotive, machinery, and industrial technology sectors. These companies viewed themselves as long-term suppliers within a network of trust, rather than anonymous vendors or development centers. Engineers frequently moved between the engineering firms and their clients. Many of these companies were located near their clients in industrial regions sometimes building onside offices. Working closely with the Mittelstand and major Original Equipment Manufacturers (OEMs) was a way of doing business.
For a long time, this model functioned effectively. The engineering providers grew as suppliers alongside their customers, and nearshoring to Central and Eastern Europe was often coordinated through these firms. They maintained extensive system knowledge and consistently helped deliver complex products across generations. However, the procurement landscape began to change. Centralized purchasing, global master agreements, and vendor consolidation soon impacted not just consulting and IT services but also engineering and development services. The longstanding symbiosis of “we know each other, we’ve worked together for years” became increasingly difficult to sustain as procurement departments began to evaluate everything based on global price tables and vendor rankings.
Even as the overall engineering market continued to grow, the rules of engagement shifted.
When Innovation and Development Were Pushed to the Outside
At the same time, large brands and international corporations—ranging from Fortune 500 companies to DAX groups—began to change their approach to research and development (R&D). Due to cost considerations, innovation and product development were increasingly outsourced. New products could only be created by integrating internal teams with a network of external suppliers and engineering partners. For decades, this collaborative model was a strength for mid-sized European firms and their engineering partners, who possessed a deep understanding of entire systems. They not only grasped individual components but also the complete systems, such as cars, machinery, and production lines. These firms were capable of designing, testing, and industrializing complex solutions that could operate effectively for decades.
However, this approach carried a hidden risk. As soon as the “simpler” tasks—such as standard modules, routine coding, and basic testing—could be outsourced to lower-cost engineering providers or offshored locations, the economic foundation of many traditional service firms began to erode. Large original equipment manufacturers (OEMs) and Tier 1 suppliers could now easily mix and match suppliers or establish in-house teams in regions with lower labor costs. As a result, the old engineering partners lost their exclusive advantage of being the primary experts in their field.
Just as these simpler projects were being outsourced, high-end innovation also faced increasing pressure.
Enter Venture Clienting and a New Engineering Logic
This is where the second book on my desk comes in: venture clienting.
Instead of purchasing innovation from long-standing mid-sized suppliers, large brands and international companies began to source it directly from startups. A venture client program does not buy “hours” or “bodies.” Instead, it seeks access to specific technologies or solutions that young companies have already developed.
This approach represents a fundamental shift in engineering logic:
Not selling time and skills; you sell existing, developed technology.
Not waiting years for a framework contract; you enter through a focused pilot under a corporate venture program.
Not just another generic service vendor; you are a startup that addresses a specific problem with a clear solution.
For corporations, this model is attractive. They can integrate innovations from startups around the world, often leveraging their existing global service agreements and legal frameworks. For many mid-sized software-heavy firms, this shift has been devastating. These companies had spent decades developing sophisticated software and system expertise behind closed doors, catering to a few key customers. Now, those same customers could simply say, “For this new feature, we will run a pilot with a startup from Berlin, Tel Aviv, or San Francisco instead.”
Some of these mid-sized firms faced dramatic insolvencies, resulting in big headlines, court proceedings, and public drama. For most, however, the decline was quieter and more gradual:
Their international ambitions were scaled back.
Their customer base began to shrink.
Top innovation projects with major clients became out of reach.
They struggled for years with declining revenue.
Ultimately, many of these firms were sold quietly, their names fading into larger corporations. This trend has affected numerous companies I have personally worked with.
Who Got Pushed Out – and Who Survived
If you take a step back, you can see a double squeeze occurring in the market. On one side, global service giants have taken over broad service and outsourcing work. On the other side, startups involved in venture client programs have dominated sharp, visible innovation projects.
This leaves tech-driven and industrial Mittelstands (SME) companies in the economic heart of Europe – in England, France, Spain, Italy and Germany – many of them software-heavy, in a very tough spot. Many of these companies, previously considered industry leaders, were strong in niche markets and closely tied to large industrial customers. However, they primarily sold engineering time and software rather than clearly defined products.
These mid-sized firms what we call Mittelstand in Germany are being squeezed from both sides:
Too Small and Local: They are often seen as too small and local to be preferred vendors in centralized procurement processes.
Too Generic and Slow: They lack the focus and agility needed to compete with startups for innovation pilots.
The only group that has more time in this changing landscape is those companies that own real hardware, such as machines and mechanical systems, rather than just software services. If a company has a machine on the factory floor or a component in a car, it can't easily be replaced overnight by a startup or a global outsourcer. These firms—product-based, often family-owned, and deep in their niche—are what we now refer to as Hidden Champions.
So Why does This Matters for Romania?
This shift has not only affected Germany, France, or the UK; it has also influenced the landscape in Romania. In the previous chapter, Romanian engineers pondered, "Where did all the good projects go?" It's easy to assume that the work simply moved to another country.
The harder truth is that many companies that used to place those orders are no longer in business. Some were merged, some were downsized due to outsourcing, some were quietly sold, and some went bankrupt.
Romania has not developed its own global service giant. Its firms have remained mid-sized, regional, and often owner-led. At first glance, this may appear to be a weakness. However, considering this history, it might actually represent a strength.
If the era of pure service factories and generic engineering providers is coming to an end, the logical next step is not to attempt to build “the Romanian Wipro.” Instead, the next step should be to create companies that own products, carve out niches, and dictate their own destinies. Not just a normal mid-sized firm like we see in Italy, France, England or Spain, but a true Hidden Champion – a small or medium-sized company with little brand recognition that quietly dominates its industry niche.
And that is where the story goes next.
My Window into Hidden Champions World
I am what you could call a second generation “Hidden Champion” worker.
In 1977, my father worked in Wiesbaden on an industrial startup project. He and his colleagues were not on magazine covers (mostly). They would never ring any stock market bells. But they built highly specialized systems that ended up in factories around the world. As a child, I grew up with stories about small German companies that quietly became world leaders in very narrow fields.
For the past fifteen years, I have been involved in building the third generation of companies. I collaborated with founders, engineers, and product teams in the Swabian region of Germany, traditionally known for its many hidden champions. My focus was on helping these companies transition from pure engineering pride to developing real, repeatable businesses. Many of the founders I worked with came from the automotive, embedded systems, and industrial technology sectors.
From that experience, I've realized one important thing: the conditions that once fostered success in Germany are no longer present there. However, they seem to be emerging in an unlikely place: Romania, where we are starting to see the rise of Hidden Champions.
Romania has strong technical people, a generation that has learned to deliver complex, long‑term projects for the biggest names in the industry. At the same time, a new set of markets is opening: emerging markets that need well‑priced technical solutions, but do not want to be trapped in the power games of big countries.
Global infrastructure is becoming more restricted. Cost alone is no longer the main driver when nations set up power grids, data centers or transport systems. Political and business leaders understand that they must invest in local data infrastructure and security. But they need technology that strengthens their sovereignty, not technology that locks them into one dominant foreign power.
That is why I believe the next wave of European Hidden Champions should come from Romania.
So What Are “Hidden Champions”?
“Hidden Champions” are medium-sized companies that are leaders in a narrow market but are largely unknown to the public. They typically aren’t big brands, aren’t publicly traded, and often operate in small towns.
Key traits include:
A focus on a specific niche where they excel globally.
Substantial investment in research and development (R&D) and deep technical expertise.
Family ownership and a long-term outlook, prioritizing decades over quarterly results.
A strong export presence, serving customers worldwide.
Germany has the highest concentration of these companies, representing nearly half of the Hidden Champions globally.
Why Did So Many Hidden Champions Grow in Germany?
Germany's notable success in nurturing Hidden Champions is not merely a matter of chance; it is deeply rooted in historical developments that have shaped the country’s business landscape and hyper globalisation of the last 30 years.
1. Many Small Kingdoms Forced to German (federal) States to think Globally
For much of its history, what we now recognize as Germany was a patchwork of many small states, each with its own identity and economy. Until 1871, Germany was what you could literally call a quilt of kingdoms, duchies and principalities rather than a single unified nation. It was the last of the major European empires to form a modern nation state, and even then it remained, at its core, a federal construct with strong regional roots.
For more than a thousand years, these kingdoms, principalities and city‑states were held together only loosely under the Holy Roman Empire. This created a diverse but very fragmented national identity: people often felt first like Bavarians, Saxons or Swabians, and only secondarily like “Germans.” In the late 19th century, this fragmentation created a strong pressure for companies to look beyond their tiny home markets if they wanted to grow.
As a result, German firms learned in the late 1970ties to think internationally, to specialize in narrow niches and to build innovative solutions that could attract customers far beyond their own state borders.
2. Strong Regional Clusters
Over time, various regions within Germany emerged as powerhouses of expertise in specific industries, fostering strong local identities and economies:
Jena: Renowned for its optical innovations (notably by Zeiss), the city later became a center for cutting-edge developments in photonics and precision measurement technologies.
Schwarzwald (Black Forest) Initially famous for exquisite clockmaking, this region evolved to become a hub for precision mechanics and advanced medical technologies, showcasing its ability to adapt to changing markets.
Sauerland/South Westphalia Known for its rich tradition in metalworking and screw manufacturing, this area has established itself as a leader in fastening technology, supported by a robust network of suppliers and highly skilled labor.
These specialized clusters have created thriving ecosystems where suppliers, expert skills, and industry know-how flourish, ultimately driving innovation.
3. Dual Vocational Training
Germany's distinctive "dual system" of education combines rigorous classroom learning with hands-on experience in a professional environment. This dual approach equips students with practical skills alongside theoretical knowledge, producing highly competent workers adept at navigating both the academic and industrial realms. Many Hidden Champions actively rely on this well-structured system to cultivate a reliable talent pipeline that supports their growth and innovation.
4. Family Business Culture
A significant proportion of Hidden Champions are family-owned enterprises, where leadership tends to stay within the family across generations. CEOs often hold their positions for twenty years or longer, fostering a deep sense of stability and continuity. This culture allows for long-term strategic investments in research, development, and employee growth, enabling these businesses to innovate consistently without the pressure of immediate market fluctuations or stockholder demands.
Germany’s 1990s Crisis and the Rise of Hidden Champions
In the early 1990s, Germany experienced a serious economic crisis. The boom that followed reunification ended in a recession in 1993. The costs of rebuilding East Germany drove up taxes and social spending, leading to the collapse or sale of many state-owned firms in the East. By the late 1990s, Germany earned the label “sick man of Europe” due to its weak growth and high unemployment. While large corporations and the labor market struggled, many Hidden Champions found opportunities for growth during this challenging decade.
1993: Recession followed the reunification boom.
Billions were spent on East Germany, resulting in higher taxes and social costs.
Numerous state-owned firms in East Germany were closed or sold off.
The label “sick man of Europe” reflects weak growth and high unemployment.
Several factors worked in favor of Hidden Champions during this period. Globalization opened up new markets through the EU single market, new trade regulations, and the opening of Eastern Europe and China. This created opportunities in niches that were previously too small for Germany but became viable on a global scale. Additionally, the IT revolution, exemplified by systems like SAP R/3, made it significantly easier to manage international supply chains and complex processes. This allowed even mid-sized companies to operate like global players. High labor costs and social charges pressured firms to increase productivity, and the most successful Hidden Champions responded by embracing automation, improving processes, and focusing on higher-value products instead of cheap mass production
The EU single market and WTO rules expanded export opportunities.
SAP R/3 enabled integrated global planning and logistics.
High wage levels necessitated a shift toward high-value, rather than low-cost, products.
The rural locations of about 70% of Hidden Champions provided them with additional advantages. Being based in small towns or the countryside resulted in lower operational costs, a loyal workforce, and strong local ties. When domestic markets were weak, these companies looked abroad; their unique products allowed them to command premium prices in international markets. Consequently, the number of identified German Hidden Champions increased from roughly 450 in the mid-1990s to over 1,500 by 2020, while their average revenue surged from under €100 million to nearly €500 million. They became the quiet backbone of German industry.
Approximately 70% of Hidden Champions are located in rural or small-town areas.
The number of Hidden Champions grew from about 450 in the mid-1990s to over 1,500 by 2020.
Their average revenue increased from below €100 million to around €500 million.
During this same period, software and embedded systems emerged as the “new machines” of the 21st century. SAP transformed from a German mainframe software provider into a global leader in enterprise resource planning (ERP) with R/3 and later S/4HANA. Companies like Nemetschek became key players in global construction software, and DATEV came to dominate tax and accounting software in Germany. The industry began to deeply integrate software into machinery, cars, medical devices, and factory systems. Hidden Champions leveraged this shift to ascend the value chain and solidify their niche positions.
-SAP, Nemetschek, and DATEV are examples of prominent German software companies.
Embedded software became integral to cars, machinery, and medical devices.
2. Romania Today: Strong Talent and Service Mindset
Today, Romania finds itself at a different starting point, yet with a similar opportunity. Over the past twenty years, it has evolved into a robust outsourcing hub for Western companies. Global players such as Continental, Bosch, NXP, Elektrobit, and Infineon have established R&D and engineering centers in the country. Romanian teams are engaged in developing automotive software, embedded systems, advanced driver-assistance systems (ADAS), AUTOSAR, and safety-critical platforms. This growth is supported by a strong engineering education system, numerous technical universities, and a large pool of IT and engineering graduates. As a result, a whole generation of Romanian developers and engineers has emerged, having collaborated with original equipment manufacturers (OEMs) and Tier-1 suppliers, transitioning pre-series designs from Western headquarters into series production, and managing long-term, strategic, and complex embedded projects.
However, there is a challenge: the "service mindset." Since most work occurs in outsourcing arrangements, product vision and business models are typically dictated by companies in Germany, France, or the United States. Romanian teams work from specifications set by these headquarters, which makes them excellent at following detailed instructions but also overly reliant on guidance from abroad. Instead of asking, “What product should exist in this market?” many teams have been conditioned to ask, “What does the customer’s specification say?” In essence, Romania excels at "build to spec," but is still developing its capacity for "build to market."
Key issues include:
Product ownership and pricing power remaining with Western headquarters.
Local teams focusing on optimizing delivery rather than product strategy or business models.
Core questions centering on specification compliance rather than market fit or niche selection.
Simultaneously, the global landscape has shifted. We are no longer in the 1990s era of pure globalization. Factors such as trade tensions, COVID-19, and geopolitical dynamics have driven a movement towards deglobalization, "friend-shoring," and nearshoring. Companies now prefer supply chains that are closer to home and situated in politically stable countries. Central and Eastern Europe is experiencing an influx of investments in electronics and manufacturing, and Romania stands to benefit significantly from this trend. As a member of the EU and NATO, it is regarded as a trusted location, boasting strong technical talent capable of providing high-end engineering rather than merely low-cost labor. Additionally, Romania is supported by new industrial policy tools such as European semiconductor programs, a national semiconductor platform, and grant schemes for manufacturing and chip production.
The shift from deglobalization results in a preference for trusted, nearby suppliers over the cheapest global options. Central and Eastern Europe is attracting more investment in manufacturing and electronics due to nearshoring.
At the same time, emerging markets in Africa, MENA, parts of Asia, and Eastern Europe require robust and affordable embedded systems-solutions that are neither as expensive as top German premium products nor as risky or low-quality as the cheapest alternatives. Romania is well-positioned to fill this gap, offering high-quality engineering at a mid-range price from a politically trusted region.
Emerging markets seek mid-priced, reliable, politically secure technology, and Romania can provide “German-level engineering” at a lower cost and reduced risk.
A Playbook for Romanian Embedded Hidden Champions
Romania can take inspiration from the German Hidden Champion model. The first step is to focus on narrow niches. German Hidden Champions often dominate highly specific global markets, such as a particular type of screw or measurement device. Romania should aim to develop similar specialized niches, such as control units for renewable energy systems in developing countries, agri-IoT devices for farms in Eastern Europe and Africa, embedded systems for medical or lab equipment, and retrofit ECUs for existing vehicle fleets. The logic is straightforward: target a small niche, but with a global market and deep expertise.
Choose niches where Romania already has technical depth:
Energy control units
Agri-IoT
Medtech embedded systems
Mobility
Second, Romania can view today’s deglobalization in a positive light, similar to how Germany regarded globalization in the 1990s: as an opportunity. Romania can provide European-made embedded systems to markets seeking secure, non-Chinese and non-US solutions. It should position itself as the go-to region for mid-priced, high-quality embedded products in and around the EU, especially for countries that want strategic autonomy and are willing to invest in technology that bolsters their sovereignty.
Position as a “trusted third option” between the US and China.
Sell not just technology, but also sovereignty and resilience to partner countries.
Third, building regional clusters is crucial. In Germany, Hidden Champions often thrive within strong industry clusters such as the Black Forest, Hohenlohe, or Sauerland. Although younger, Romania has real clusters: Timișoara for automotive and embedded systems, Cluj-Napoca for software and startups, and Brașov, Iași, and Bucharest as engineering and tech hubs. These regions need to transition from purely providing services for foreign headquarters to establishing their own product ecosystems.
Timișoara, Cluj, Brașov, Iași, and Bucharest are ideal launch pads.
Goal: evolve from service centers to product companies with local intellectual property and brands.
Fourth, strengthening practical skills is essential. Germany’s dual education system produces highly skilled workers both on the shop floor and in engineering. While Romania has strong academic programs in engineering and IT, there is a need for a more robust mid-level vocational layer. To cultivate embedded Hidden Champions, Romania will require more laboratories, pilot factories, and dual-type programs—not only coders but also individuals who can design, build, test, and industrialize hardware.
Add practical training to the strong academic foundation.
Create laboratories and pilot lines for rapid prototyping and small-scale production.
Finally, ownership and the time horizon are significant factors. Most German Hidden Champions are family-owned and think in terms of decades. In contrast, Romania is currently dominated by outsourcing providers and young startups, with a long-term ownership culture still in development. To cultivate Romanian Hidden Champions, the ecosystem needs engineer-founders who transition from being employees to entrepreneurs, funding models that support ten or more years of building rather than quick exits, and local ownership of intellectual property and products, not just services.
The good news is that there are already successful examples: UiPath, Bitdefender, and AROBS demonstrate that Romanian-founded product companies can scale globally. The talent and ambition are present; the challenge now is to replicate this success in embedded systems and industrial technology.
Encourage engineers to establish product companies rather than agencies.
Utilize patient capital and mentorship, rather than solely relying on venture capital exit strategies.
Build on existing success stories like UiPath, Bitdefender, and AROBS
For individual tech professionals in large centers, observing declining project pipelines, this is not merely theoretical. It pertains directly to the next ten years of their careers. In all four pathways—soft landing, hard cuts, reskilling, and new companies—there are options, but Europe, as a region, needs more than mere survival stories. A new generation of Hidden Champions is necessary, or the tech landscape will continue shrinking until only crumbs remain.
In some German automotive regions, we are already witnessing the consequences of a lack of new vision: an increasing number of firms are collapsing, and managers and engineers remain fixated on "more projects, more variants." By the time they recognize that the old model has expired, it is often too late. Romania has the opportunity to craft a different narrative. The strong technical skills that once supported global giants can now be redirected toward developing independent products—products that help emerging societies maintain their freedom and sovereignty rather than fall into forced dependency.
Summary: Now Is the Time
I grew up witnessing the emergence of the second generation of Hidden Champions in Germany, a time marked by innovation, resilience, and a deep commitment to craftsmanship. Over the past fifteen years, I have dedicated myself to fostering the third generation, collaborating with visionary founders and talented teams across Europe to create a vibrant ecosystem of innovation.
However, I have come to realize that the next wave of pioneering companies will not primarily emerge from Germany. The landscape has shifted dramatically due to changes in deglobalisation contexts, evolving cost structures, and the complex political realities we face. Instead, I see tremendous potential in a different location: Romania. Here, the right pieces are beginning to align, creating a fertile ground for growth and creativity.
Now is the moment for seasoned engineers, proficient team leads, and visionary architects in Romania—and similar emerging tech hubs—to step beyond the conventional boundaries of pure outsourcing. It's time to embrace true ownership and responsibility for the products we develop.
We need to transition from a mindset of “build to spec,” where projects simply meet predetermined requirements, to “build to market,” where we craft solutions that resonate with real customer needs and market demands. It’s essential that we recognize and elevate our hidden talents into notable Hidden Champions, companies that can lead with innovation and purpose.
The world is undergoing profound transformation. Deglobalisation changes how supply chains are being restructured, and countries are increasingly seeking technologies that reinforce their sovereignty rather than serve foreign interests.
If we navigate this evolution thoughtfully, the next generation of European Hidden Champions will not only excel in delivering high-quality embedded systems but will also become architects of strong, resilient states in a world that grows more fragile by the day. Together, we can forge a future defined by innovation, integrity, and independence.